DoD awards Raytheon $21.2M for Navigation Systems, raising concerns over lack of competition

Contract Overview

Contract Amount: $21,229,613 ($21.2M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2003-02-26

End Date: 2011-08-13

Contract Duration: 3,090 days

Daily Burn Rate: $6.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Place of Performance

Location: MCKINNEY, COLLIN County, TEXAS, 75071

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $21.2 million to RAYTHEON COMPANY for work described as: Key points: 1. Significant award value of $21.2 million to a single contractor. 2. Sole-source award to Raytheon Company indicates potential lack of market competition. 3. Contract duration of 3090 days suggests a long-term need, but competition method is unclear. 4. The sector is Defense, a high-spending area with complex procurement needs.

Value Assessment

Rating: questionable

The award value of $21.2 million is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar navigation system contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no competitive pressure to lower bids.

Taxpayer Impact: The lack of competition in this $21.2 million award means taxpayers may have paid a premium, as the government did not leverage market forces to secure the best possible price.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. Lack of transparency in the procurement process raises accountability questions. Potential for reduced innovation if only one company is consistently awarded contracts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Long contract duration without clear justification for no competition
Lack of transparency in pricing

Positive Signals

Award to a known defense contractor
Firm Fixed Price contract type can provide cost certainty

Sector Analysis

This contract falls within the Defense sector, specifically manufacturing navigation systems. Defense spending often involves complex, high-value contracts, and benchmarks for similar systems can vary widely based on technological sophistication and specific requirements.

Small Business Impact

The data does not indicate any specific provisions or considerations for small businesses in this sole-source award to Raytheon Company. This suggests a missed opportunity to engage smaller, innovative firms in the defense supply chain.

Oversight & Accountability

The sole-source nature of this award warrants further oversight to ensure the price paid was fair and reasonable. Accountability could be strengthened by a post-award review of the justification for not competing the contract.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Lack of competition
Potential for inflated pricing
Limited transparency
Missed opportunity for small business participation
Long contract duration without clear justification for sole-sourcing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.2 million to RAYTHEON COMPANY. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $21.2 million.

What is the period of performance?

Start: 2003-02-26. End: 2011-08-13.

What was the specific justification for awarding this contract on a sole-source basis, and was it adequately documented?

The provided data states the contract was 'NOT COMPETED' but does not offer the specific justification. Typically, sole-source awards require a documented justification, such as a unique capability or urgent need, approved by appropriate authorities. Without this justification, it's impossible to assess the validity of bypassing competition.

How does the $21.2 million award compare to the estimated value of similar navigation system contracts awarded competitively?

Benchmarking this $21.2 million award against competitively procured contracts is challenging without more specific details on the system's capabilities and the contract's scope. However, sole-source awards are generally expected to be higher than competitive ones due to the absence of market pressure. A detailed analysis would require comparing technical specifications and contract terms.

What is the long-term strategic impact of awarding such a significant contract without competition on the development of advanced navigation technologies?

Awarding significant contracts without competition can stifle innovation by reducing the incentive for alternative providers to invest in developing competing technologies. It may also lead to vendor lock-in, limiting the government's flexibility and potentially hindering the adoption of more advanced or cost-effective solutions in the future.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 2501 W UNIVERSITY DRIVE M, MC KINNEY, TX, 03

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline